Protein tyrosine kinases (PTKs) and protein tyrosine phosphatases (PTPs) are major control switches in the protein networks that govern cell signaling, movement, differentiation, and other processes. These enzymes thus play central roles in normal development as well as in cancer, diabetes, and other diseases. The fly Drosophila melanogaster provides a powerful model system to study the role of PTPs in cancer-related processes such as cell migration, growth factor signaling, hematopoiesis, and apoptosis. Genetic analysis is proposed to elucidate the functions of two novel Drosophila PTPs, named Pez and Meg after their human orthologs. Pez and Meg are FERM-PTPs, modular proteins that contain a FERM (4.1, ezrin, radixin, moesin-like) domain, a PTP domain, and additional protein-protein interaction motifs. Like other FERM domain proteins, Pez and Meg may reside at the cell cortex and participate in multiprotein complexes important for cell motility or adhesion, processes that are relevant to tumor metastasis. To test this hypothesis, three aims will be pursued. 1) Mutant animals will be generated that lack only Pez, and the resulting phenotypes will be documented to determine if Pez is essential for development. 2) Genetic modifier tests will be performed to identify the pathways regulated by Pez and Meg. Small deletions removing either the Pez or the Meg gene will be crossed into flies with activated or inhibited PTK pathways; a functional interaction is indicated if the deletion modifies the PTK phenotype. 3) To shed light on their biological roles, the developmental expression pattern and subcellular location of Pez and Meg will be documented by in situ RNA hybridization and immunolocalization studies. Since FERM-PTPs have not been analyzed by gene knockout in any organism, these experiments will provide novel insights into the role of this family in normal and abnormal cell behaviors. This work is part of a long-term molecular genetic investigation of the role of membrane-cytoskeleton proteins in signaling and cell movement.